ETF Investors Shrug Off Market Uncertainties, Bullish on Mag 7, Schwab Survey Finds

exchange-traded fund (ETF) investors.

Most ETF investors surveyed by Charles Schwab (SCHW) Asset Management said that these economic and political events did not change the way they invest in ETFs. In fact, roughly a third of the investors put more money into ETFs based on their reading of stock market volatility, high interest rates and persistent inflation, according to the survey results released this week.

ETFs have a track record across market cycles, said David Botset, Managing Director, Head of Innovation and Stewardship at Schwab Asset Management, adding that “investors are confident in their investments even when the outlook is uncertain.”

What Are ETF Investors Betting On?

ETF investors have grown more bullish on certain types of stocks and sectors since last year: 69% are bullish on technology and 60% on growth stocks.

Additionally, 55% of investors are optimistic about the the Magnificent 7, a group of seven mega-cap technology companies including Nvidia (NVDA), Meta (META), Amazon (AMZN), Microsoft (MSFT), Alphabet (GOOG) (GOOGL), Apple (AAPL) and Tesla (TSLA).

The Mag 7 stocks have a big influence on the stock markets and have driven much of the S&P 500’s returns over the past year. But when they falter, as they did in July this year, they tend to drag the broader stock market down with them.

Millennials Want Crypto Risk But Are Also Risk-Averse

The survey also showed how investment preferences vary across generations.

For instance, 62% of millennials (or those born between 1981 and 1996), said they plan to invest in cryptocurrency ETFs over the next year versus 15% of Boomers (or those born between 1946 and 1964). A quarter of millennials said they plan to invest in alternatives ETFs, compared with just 11% of boomers.

At the same time, 44% of millennials also want to increase their exposure to lower-risk fixed income ETFs. In contrast, fewer GenX (34%) and Boomer (26%) investors plan to do likewise.

This is in line with other recent studies that point to recent stock market volatility making millennials more risk-averse compared to some older generations.

Read the original article on Investopedia.